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Sturm, Ruger (RGR) Q1 Earnings Down Y/Y, Sales Top Estimates
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Sturm, Ruger & Company, Inc.’s (RGR - Free Report) first-quarter 2018 earnings of 81 cents per share reflected an annual decline of 33.1% from the year-ago quarter’s figure of $1.21. The downside can be attributed to year-over-year decline in sales and operating income.
Sales
In the quarter under review, the company’s net sales came in at $131.2 million, down 21.6% from the prior-year figure of $167.4 million. However, the top line comfortably surpassed the Zacks Consensus Estimate of $117 million by 12.1%. Lower production volumes led to the year-over-year decline in sales.
Firearm sales (comprising 99% of total sales) decreased 21.9% on a year-over-year basis, while castings sales improved 28.9%. New product sales accounted for 29% of total firearm sales in the first quarter compared with 25% in the year-ago quarter.
Sturm, Ruger & Company, Inc. Price, Consensus and EPS Surprise
Sturm, Ruger declared a first-quarter dividend of 32 cents per share, payable on Jun 1, 2018, to shareholders of record as of May 22. The dividend represents about 40% of net income. This reflects an improvement of 39.1% from dividend of 23 cents per share, which the company paid in the fourth quarter of 2017.
Per management, dividend payout varies every quarter as it is based on a percentage of earnings rather than a fixed amount.
Operational Highlights
Gross profit decreased 35.8% to $35.8 million in the reported quarter. Gross margin contracted 60 basis points (bps) to 27.3% at the end of first-quarter 2018 compared with 33.3% at the end of first-quarter 2017.
Total operating expenses dropped 21.3% year over year to $17.2 million in first quarter owing to lower selling expenses. Operating income also declined 45.1% to $18.6 million from $33.9 million at the end of first-quarter 2017.
Sturm, Ruger’s earnings before interest, taxes, and depreciation and amortization was $27.1 million, down 37.8%.
Financial Performance
The company ended first-quarter 2018 with cash of $103 million compared with $63.5 million at 2017-end.
Cash generated from operations was approximately $45.3 million compared with $18.9 million in the year-ago quarter. The current ratio is 3.0 to 1, with no outstanding debt.
Capital expenditures totaled $1 million at the end of first-quarter 2018, down from $7.5 million in the prior-year quarter. For 2018, the company continues to expect capital expenditures of about $15 million.
Sturm, Ruger returned $4 million to shareholders through dividend payments during the first quarter.
Pool Corporation’s (POOL - Free Report) first-quarter 2018 earnings of 75 cents per share surpassed the Zacks Consensus Estimate of 70 cents by 7.1%.
Clarus Corporation’s (CLAR - Free Report) first-quarter 2018 earnings of 13 cents per share missed the Zacks Consensus Estimate of 16 cents by 18.8%.
Malibu Boats, Inc. (MBUU - Free Report) first-quarter 2018 earnings of 89 cents per share outpaced the Zacks Consensus Estimate of 71 cents by 25.4%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Sturm, Ruger (RGR) Q1 Earnings Down Y/Y, Sales Top Estimates
Sturm, Ruger & Company, Inc.’s (RGR - Free Report) first-quarter 2018 earnings of 81 cents per share reflected an annual decline of 33.1% from the year-ago quarter’s figure of $1.21. The downside can be attributed to year-over-year decline in sales and operating income.
Sales
In the quarter under review, the company’s net sales came in at $131.2 million, down 21.6% from the prior-year figure of $167.4 million. However, the top line comfortably surpassed the Zacks Consensus Estimate of $117 million by 12.1%. Lower production volumes led to the year-over-year decline in sales.
Firearm sales (comprising 99% of total sales) decreased 21.9% on a year-over-year basis, while castings sales improved 28.9%. New product sales accounted for 29% of total firearm sales in the first quarter compared with 25% in the year-ago quarter.
Sturm, Ruger & Company, Inc. Price, Consensus and EPS Surprise
Sturm, Ruger & Company, Inc. Price, Consensus and EPS Surprise | Sturm, Ruger & Company, Inc. Quote
Dividend
Sturm, Ruger declared a first-quarter dividend of 32 cents per share, payable on Jun 1, 2018, to shareholders of record as of May 22. The dividend represents about 40% of net income. This reflects an improvement of 39.1% from dividend of 23 cents per share, which the company paid in the fourth quarter of 2017.
Per management, dividend payout varies every quarter as it is based on a percentage of earnings rather than a fixed amount.
Operational Highlights
Gross profit decreased 35.8% to $35.8 million in the reported quarter. Gross margin contracted 60 basis points (bps) to 27.3% at the end of first-quarter 2018 compared with 33.3% at the end of first-quarter 2017.
Total operating expenses dropped 21.3% year over year to $17.2 million in first quarter owing to lower selling expenses. Operating income also declined 45.1% to $18.6 million from $33.9 million at the end of first-quarter 2017.
Sturm, Ruger’s earnings before interest, taxes, and depreciation and amortization was $27.1 million, down 37.8%.
Financial Performance
The company ended first-quarter 2018 with cash of $103 million compared with $63.5 million at 2017-end.
Cash generated from operations was approximately $45.3 million compared with $18.9 million in the year-ago quarter. The current ratio is 3.0 to 1, with no outstanding debt.
Capital expenditures totaled $1 million at the end of first-quarter 2018, down from $7.5 million in the prior-year quarter. For 2018, the company continues to expect capital expenditures of about $15 million.
Sturm, Ruger returned $4 million to shareholders through dividend payments during the first quarter.
Zacks Rank
Sturm, Ruger carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Peer Releases
Pool Corporation’s (POOL - Free Report) first-quarter 2018 earnings of 75 cents per share surpassed the Zacks Consensus Estimate of 70 cents by 7.1%.
Clarus Corporation’s (CLAR - Free Report) first-quarter 2018 earnings of 13 cents per share missed the Zacks Consensus Estimate of 16 cents by 18.8%.
Malibu Boats, Inc. (MBUU - Free Report) first-quarter 2018 earnings of 89 cents per share outpaced the Zacks Consensus Estimate of 71 cents by 25.4%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>